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1. NONPROFIT INVESTOR
INDEPENDENT RESEARCH FOR PHILANTHROPY
Project GRAD Houston SUMMARY
Project GRAD Houston (GRAD) is an education reform model at work
Nonprofit Investor Rating: in five feeder patterns (Davis, Sam Houston, Reagan, Wheatley and
NEUTRAL Yates) within Houston Independent School District (HISD), serving 64
schools and over 44,000 economically disadvantaged children – 23%
of the school district's total school population and approximately
Mission Statement
24%of its total at-risk population.
The mission of Project GRAD is to support a
quality public education for all students in STRENGTHS
economically disadvantaged communities so
that high school and college graduation rates ▲ 20+ year track record. GRAD has been providing low-income,
increase. first-in-family-to-attend-college individuals with academic and social
opportunities since 1994.
Financial Overview
▲ Strong partnership with HISD. GRAD offers subject matter
$ in MM, Fiscal Year Ended December 31
2008 2009 2010
expertise and economy of scale to help HISD schools to increase
Revenue and Support $5.7 $5.1 $5.5 college awareness.
Operating Expenses $5.0 $5.0 $5.0
▲ Robust program. GRAD covers all aspects of students’ growth
% of Total: from elementary school through college, featuring scholarship,
Program Expenses 86.1% 87.4% 85.8% summer institute, fine arts program, college mentorship, and parent
G&A 12.3% 11.1% 12.4% involvement.
Fundraising 1.5% 1.5% 1.9%
CAUTIONS
Year Founded: 1994 ● Key program metrics have been defined but specific data points
have yet to be released. GRAD made certain statistics available but
Contact Details we would like to see (1) statistics on individual participants to
Project GRAD Houston understand cost per beneficiary served and (2) detailed spending on
3000 Richmond, Suite 400 Wages & Salaries (~$2MM).
Houston, Texas 77098
832-325-0325 ● Lack of detail regarding programs provided. NPI suggests that
GRAD provides more detailed information regarding its program
http://www.projectgradhouston.org/ activities on its website and/or through annual reports.
EIN: 76-0450397
RECOMMENDATION: NEUTRAL
Analyst: Sheng Xu Project GRAD has a longstanding history with HISD, providing
Peer Review: Kent Chao, Ruth Yen programs such as scholarship, mentoring, and education. While a
small sample of results provided by GRAD indicates increased
Publication Date
graduation rates and decreased dropout rates, lack of broader
September 27, 2012
disclosures of results and lack of detail regarding program services
provided by GRAD limit the ability to draw a causal link between
programs provided and results achieved.
Nonprofit Investor Research | nonprofitinvestor.org

2. OVERVIEW OF GRAD ACTIVITIES
GRAD provides college awareness and readiness programs for HISD schools. The charity leverage community network
and subject matter expertise to address its mission. The following are GRAD’s main programs:
• Scholarship:
o The Project GRAD Houston Scholarship Program provides financial assistance toward a college education
to eligible high school seniors in Houston, Texas. Each qualifying student is awarded up to $1,000
annually, for a total of four years. The scholarship is intended to be used continuously over four
consecutive years.
o GRAD students must attend two College Institutes while in high school to receive their $4,000
Scholarship. The College Institute offers the uniqueness of being their first college experience.
• Service:
o Walk for Success utilizes thousands of volunteers on a Saturday morning each fall to conduct a door-to-
door campaign visiting the homes of every new ninth grade student's family in GRAD-partnering high
schools. Volunteers inform parents of college access opportunities while encouraging their involvement
with each child's school.
o College Success Programs through support systems that network mentors and peer leaders with college
freshmen.
 College Access is a library of materials and resources to better prepare students for college.
 Mentorship programs support entering freshmen and upper classmen, including face-to-face
meetings and connecting students to on-campus resources.
 GRAD Ambassador Program allows successful upperclassmen to serve as college peers. They
meet with lower classmen for at least once a month to advise them through experience and
resources.
• Parent Involvement
o Parent University is a series of workshops developed by GRAD to help parents become knowledgeable
about the academic, financial, social and emotional aspects of preparing for, applying to and succeeding
in college.
o Parent Convention is an annual event held on a different Houston area college campus each year offers
parents an array of sessions on college preparation, admission, financial aid as well as new and emerging
career opportunities.
PROGRAM RESULTS AND EFFECTIVENESS
In the first four high schools with GRAD programs, school dropout rates decreased by about 9% from 2006 to 2009,
compared to 5% for schools without GRAD programs. From 1997 to 2009, the first four GRAD high schools increased
graduation rates from 42.5% to 66.6% while other high schools remained flat at 55.1%. In 2010, GRAD served ~1,700
students, 91% of which were first generation College bound. However, since GRAD does not comment on the statistical
significance of the results of the four schools with GRAD programs vs. the 66 schools currently served by GRAD, it is not
possible to understand whether these results are representative of GRAD’s overall effectiveness. Additionally, due to
lack of detail on specific program offerings, it is unclear whether the programs services provided to the first four GRAD
programs function similarly to other schools served by GRAD.
Project GRAD Houston | Nonprofit Investor Research 2

3. TRANSPARENCY
The programs of GRAD are determined by the Board of Directors and developed and managed by the directors of the
senior management. Therefore, transparency into the GRAD activities and successes is available at the website with
specific program results via the website, including high school graduation rates, dropout rates, college acceptances and
graduation rates. GRAD made available 2010 annual reports directly on its website which were helpful in communicating
notable contracts with HISD and government grants. The charity has also filed its Form 990s on a regular basis. To
further increase transparency, we would like to see statistics on individual participants in various programs and more
detailed expense breakouts for employee salaries.
Project GRAD Houston | Nonprofit Investor Research 3

4. FINANCIAL OVERVIEW
Revenues
GRAD generates the majority of its revenue from service contracts, which are contracts with HISD schools, making up
approximately 68% of total revenue in 2010. The contract is a six year GEAR UP grant awarded to HISD from the U.S.
Department of Education. The grant award is $3,122,400 per year for the period 2005-2011. In 2010, GRAD also entered
into a one-year agreement with HISD to provide program service to 66 campuses. The contract is expected to be
renewed in 2011. In 2008, U.S. Department of Education awarded GRAD a four year Federal grant (FAME) to continue
funding certain fine arts programs. The award is $252,363 per year. While revenue decreased 10.5% in 2009, the service
contracts helped GRAD to grow 7.8% in 2010 with $5.5MM in revenue.
Expenses
Approximately 86% of GRAD’s total expenses is spent on Program Services. 12% of total expenses is spent on G&A, and
1.5% is spent on fundraising. The low percentage spent on fundraising is a result of multi-year contracts with HISD and
government grants mentioned in the revenue section. The large percentage of program expense is primarily comprised
of wages and salaries (~$2MM) for staff, teachers, and mentors. GRAD prides itself in recruiting excellent talent,
leveraging its expansive community outreach and network. Human capital is considered to be the backbone of GRAD’s
success and therefore making up a large portion of its expense. However, GRAD does not disclose the specific allocation
of the $2MM of wages and salaries on a per program basis. NPI recommends that GRAD track and disclose this
allocation in order to provide donors with an understanding of how program costs relate to program services delivered.
In the Program Services numbers, grants and summer institute program expense increased slightly while other program
expense remained flat. The increase of grants to $1MM from $0.87MM is the result of growth due to the addition of a
government grant.
Revenue Mix Over Time 2010 Revenue Mix
$ in MM
$6.0 $5.7 0%
$5.5
$5.1
$5.0 27%
$4.0
$3.0
$2.0 5%
68%
$1.0
$0.0
2008 2009 2010
Contributions Government Grants
Service Contracts Investment Income
Service Contracts Government Grants Contributions Investment Income Other
Other
Project GRAD Houston | Nonprofit Investor Research 4

5. Expense Breakout Over Time
$ in MM
$5.2 100%
$5.0 $5.0 $5.0
90%
$5.0
86.1% 87.4% 85.8% 80%
$4.8 70%
$4.6 60%
50%
$4.4 40%
$4.2 30%
20%
$4.0
10%
$3.8 0%
2008 2009 2010
Total Program Expense Total G&A Expense
Total fundraising expense Program Expense % of Total
GRAD’s ability to leverage its network and expertise to maintain the relationship with HISD will be critical to its success.
Approximately 68% of GRAD’s revenues is on a termed contract basis and has provided stability for the past three years.
GRAD needs to maintain the contract revenue stream (~$3.5mm) in order to support the large portion of expenses
(~$2MM) allocated to the program staff. After the expiration of the contracts, fundraising expenses at $95,000may
increase if existing contracts are not renewed.
Project GRAD Houston | Nonprofit Investor Research 5

6. Detailed Financial Information
$ in MM
Fiscal Year Ended December 31 2008 2009 2010
Operating Revenue:
Contributions $1,759,163 $1,233,336 $1,483,883
Government Grants 280,434 287,438 267,343
Service Contracts 3,351,202 3,547,386 3,738,633
Investment Income 3,224 63 44
Other 268,069 - -
Total Support and Revenues $5,662,092 $5,068,223 $5,489,903
% Growth -10% 8%
Expenses:
Program expenses
Grants and other assistance $781,500 $867,751 $1,008,102
Summer Institute Program 355,386 571,062 563,031
Other Salaries and wages 2,075,088 2,052,118 1,937,407
Service Fees 324,709 272,804 252,573
Office Expenses 545,747 388,917 400,510
Other 185,578 241,001 167,156
Total Program Expense $4,268,008 $4,393,653 $4,328,779
General and Administrative expense
Compensation $208,201 $203,106 $207,059
Other Salaries and wages 228,384 250,942 272,964
Service Fees 49,979 40,396 46,083
Office Expenses 38,795 28,258 44,926
Other 86,213 35,565 52,888
Total G&A Expense $611,572 $558,267 $623,920
Fundraising expenses
Other Salaries and wages $66,057 $70,816 $77,286
Service Fees 2,476 100 -
Office Expenses 5,041 5,140 14,791
Other 1,159 1,429 3,217
Total fundraising expense $74,733 $77,485 $95,294
Total Expenses: $4,954,313 $5,029,405 $5,047,993
% of Revenue 87% 99% 92%
Revenue Less Expenses $707,779 $38,818 $441,910
Program Costs as a % of Total Expenses 86% 87% 86%
G&A as a % of Total Expenses 12% 11% 12%
Fundraising as a % of Total Expenses 2% 2% 2%
Source: IRS Forms 990
Project GRAD Houston | Nonprofit Investor Research 6

7. THIRD PARTY RATINGS
Charity Navigator rates the organization 3 out of 4 stars, receiving a 66 out of 70 score for accountability and
transparency. GRAD receives a 48.04 out of 70 for financial and has an official representative registered with Charity
Navigator.
Guide Star has awarded GRAD with the Guide Star Exchange Seal for commitment to transparency.
(http://www.guidestar.org/organizations/76-0450397/project-grad-houston.aspx)
Project GRAD Houston is not currently reviewed on Great Nonprofits.
GET INVOLVED
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Volunteer: http://www.projectgradhouston.org/pace/walk-for-success.php
DISCLOSURES
Sheng Xu certifies that she does not have any affiliation with Project Grad Houston and has never made a donation to the
organization. Additionally, Sheng has not supported directly competing organizations in a greater capacity than a nominal donation.
NPI analysts and NPI as an organization do not receive any form of compensation from reviewed charities.
This report is for informational purposes only and does not constitute a solicitation for donations. While the reliability of information
contained in this report has been assessed by NPI, NPI makes no representation as to its accuracy or completeness, except with
respect to the Disclosure Section of the report. Any opinions expressed herein reflect our judgment as of the date of the materials
and are subject to change without notice. NPI has no obligation to update, modify or amend any report or to otherwise notify a
reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes
or subsequently becomes inaccurate, or if research on the subject organization is withdrawn.
Opinions and recommendations in our reports do not take into account specific reader circumstances, objectives, or needs. The
recipients of our reports must make their own independent decisions regarding any organization mentioned by NPI.
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Project GRAD Houston | Nonprofit Investor Research 7